Petroleum dealers assoc. VP: Gas prices could hit $8 per gallon

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Petroleum dealers assoc. VP: Gas prices could hit $8 per gallon

This week, a gallon of gas hit $6.33 at Rubis gas stations, $6.16 at Esso and $5.50 at Shell

On its current track, gas prices could reach as high as $8 per gallon this summer, Vice President of the Bahamas Petroleum Dealers Association (BPDA) Vasco Bastian said yesterday, adding that prices are at an all-time high.

This week, a gallon of gas hit $6.33 at Rubis gas stations, $6.16 at Esso gas stations and $5.50 at Shell gas stations.

“This is the highest I’ve ever seen it on New Providence in 15 years, that I can remember. Unless there is some data to show me that I lie, it’s the highest I’ve ever seen. And if we continue the trend like this, I can see $8 easily this summer,” Bastian said, pointing out that the usually lower priced diesel fuel was now at its highest.

“Diesel is at its highest. Boats and buses, all the heavy equipment and all that other stuff use it. I’ve seen that go up in the last several weeks, $5.25 is for diesel and $6.16 is gas, and that will move to about $8 by summer, I think, and diesel – because they are using all the diesel for the heavy equipment in the war and all – that will probably go as high as, or over, $6 as well. That will cause all prices to go up. Bus drivers will need an increase and heavy equipment operators, mailboats, everybody will feel it.”

Bahamians were equally alarmed yesterday by the prices they saw at the pumps. But Eugene Horton, 55, who works as a technician for IBM Bahamas, said there’s nothing Bahamians can do but endure the price hikes.

“It’s something we’ll have to deal with because of what’s happening external to us. We don’t have control of it. So, like everything else, we’ll just have to make adjustments and drive less. Even if you use public transportation, someone has to pay for gas, so we just have to brainstorm and figure out better solutions, whether it is getting an electric car, we’ll have to see,” he said.

Outside the Prince Charles Plaza, Shelique Johnson called the gas prices ridiculous.

“You basically have to go to work and then go back home. I don’t understand, I don’t get it. It shouldn’t be that high. When you see people in the US complaining, you know its high. It’s really tough for people,” she said.

Colyn McDonald, 24, who works as a heavy equipment operator, said the money he would use for his daughter now has to be spent on gas.

“Gas prices are outrageous. They’re trying to kill the people. They are taking away from her money,” he said.

Donald McIntosh, 48, from Abaco, who just started working as a chef two weeks ago, said he’s just getting back on his feet again after two years of hardship following Hurricane Dorian and the COVID-19 pandemic, to now be faced with rising gas prices.

“I’m not a driver at this time, but I have friends that take me from place to place, and listening to them complaining to me about it is outrageous. Not only that, some people are not working and can hardly get a paycheck, so it is very costly,” he said.

All of the people Guardian Business spoke with said the government should do more to alleviate the strain rising gas prices will have on residents.

The government gets about $1.60 for every gallon of gas sold right now. It collects value-added tax (VAT) on the wholesale and retail sale of gasoline.

“The government could intervene like how they did in Barbados, but you don’t want to put that much pressure on the government right now. The government is doing the best that they can under the circumstances. But we will have to sit down with the government shortly because we are losing as dealers. Every time we have to buy fuel and the price goes up, our margin is fixed. So, if the price goes up, I can’t pass that on to the consumers,” Bastian said, adding that if the government really wanted to give immediate relief, it would reduce the portion it collects in taxes.

He continued, “Reducing their tax can work, but where will they get the money from that shortfall? Their tax on fuel is a $1.60 right now. If they go down to say $1.20, that’s $0.40 times the hundreds of millions of gallons of gas they tax every time. Let’s say that equates to $80 million, how are they going to get that $80 million back? It’s an easy tax, a lazy tax, it’s something the government reaps the benefit of but has no investment in.

“Gas station owners and operators do not make the majority of their money from gasoline and diesel sales. The government of The Bahamas, be it FNM, PLP, DNA, makes the majority of the money.”

Prime Minister Philip Davis indicated earlier this month that the government was not minded to follow the route of Barbados and other regional neighbors of implementing a tax break on gas.

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